Governance of Article 6 of the Paris Agreement and Lessons Learned from the Kyoto Protocol

Fixing Climate Governance Series Paper No. 4

May 4, 2017

Article 6 of the Paris Agreement provides for the transfer of mitigation outcomes between parties, which could then be used to meet their NDCs — the pledges that these countries have made under the agreement.

This provision could enable the creation of an international carbon market, through which these countries’ governments, and private entities, could trade emissions permits across national boundaries. This paper examines the lessons learned from the Kyoto Protocol with respect to the governance of international carbon markets, and how these lessons relate to the provisions under the Paris Agreement’s article 6.

The Paris Agreement has outlined the broad political lines of how such a market would function but provided limited specificity as to how to operationalize it. To reach an agreement in Paris, many issues were left reasonably ambiguous, and this is especially true with respect to the issue of governance of article 6. Consequently, there remain significant amounts of work to do, and many issues to negotiate.

This paper identifies issues to be decided with respect to article 6, options for dealing with them and outcomes to strive for.

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Fixing Climate Governance Series

Climate scientists agree that human activity has been changing our planet’s climate over the long term. Without serious policy changes, scientists expect devastating consequences in many regions: inundation of coastal cities; greater risks to food production and, hence, malnutrition; unprecedented heat waves; greater risk of high-intensity cyclones; many climate refugees; and irreversible loss of biodiversity. Some international relations scholars expect increased risk of violent conflicts over scarce resources and due to state breakdown. Environmentalists have been campaigning for effective policy changes for more than two decades. The world’s governments have been negotiating since 1995 as parties to the United Nations Framework Convention on Climate Change (UNFCCC) . Their 2015 Paris Agreement created a new regime for joint action; among other things, it is the first UN climate agreement to oblige all parties to make some contribution. Each party made a pledge pertaining to the period 2020 to 2025 or 2030. But it is widely agreed that if they are all implemented, together these 2015 pledges will still fall far short of what is needed to meet the collective goals and avoid widespread catastrophes. Important details of the Paris Agreement itself also remain to be negotiated. Nor is the UNFCCC the whole of international climate governance. Many initiatives have also been launched by smaller sets of countries, national governments, provinces, cities, civil society, and private investors and companies.   This project was designed to generate improved ideas for both the United Nations Framework Convention on Climate Change (UNFCCC) process and other possible sites of climate governance. In 2015, we published nine policy briefs and papers, which can be found below. The ideas in two of them appeared in Paris during COP21. Several offered original recommendations for more effective action outside the UNFCCC. A new series of publications appeared in 2016-2017.  

About the Author

Andrei Marcu is currently a senior fellow at the International Centre for Trade and Sustainable Development and director of the European Roundtable on Climate Change and Sustainable Transition.